One of the steps in the process of getting a brand new RTM home project underway is sourcing a mortgage. It is not too dissimilar, but getting financing for an RTM home can follow a slightly different process than other types of mortgages. Some local lenders, such as Affinity Credit Unions, are more RTM project friendly than some others.
Below are some typical requirements that will come up in the process so you know what to prepare for when financing an RTM project.
Typical Mortgage Requirements for an RTM Include:
- The lender will need to release funds before the home is delivered on-site.
- You often must own the land you plan to build on or need to coordinate the mortgage around this purchase. Changing land titles can delay a project so start asap if you know this will be required.
- The home must be anchored to a foundation.
- You will need a contract or purchase of sale with terms spelled out by the builder including obligations for each party
- Home owners will need to purchase insurance.
- RTM homeowners will require a building permit to ensure your project complies with local and national code.
- A water test is often a requirement.
Check with your local bank or lender as some Credit Unions offer a specific percentage of building funds that are advanced based on approved inspections. B&B Homes finds that mortgage brokers may offer more flexible options with favorable rates, but rarely meet the requirements made by us. However, if they cannot meet the terms required for RTMs, Credit Unions’ may be good alternatives. If you would like an introduction to an institution or bank we have successfully worked with, please contact us with your request for an introduction.